By Laurence Frost and Matthieu Protard
PARIS Oct 17 A flotation of French battery
maker Blue Solutions may value the loss-making company at up to
418 million euros ($564 million), its owner said on Thursday,
signalling growing investor appetite for electric-car
Bollore group, which is controlled by French
industrialist Vincent Bollore, said it had set an indicative
offer price of between 12 and 14.50 euros per share for the
company that makes batteries to power cars.
Sales of pure electric cars have so far been sluggish, with
many consumers deterred by the limited distance they can travel
between charges. But despite the slow start and high-profile
failures, the technology is attracting more attention as more
mainstream brands join the fray and successful startups emerge.
Bollore group, which announced the plan to float 10 percent
of the company last week, said the sale of 2.88 million shares
would value Blue Solutions - which lost 22.4 million euros last
year on sales of 61.7 million - at between 346 million and 418
"The overall price tag looks quite high and the business
model remains risky," said a Paris-based fund manager who holds
some Bollore shares. "But if you believe electric cars have a
strong potential and Blue Solutions could catch fire, then it's
not too expensive."
The flotation, in which the Bollore group and its affiliate
Bollore Participations will each offload part of their holdings
in the company, follows September's announcement of an
electric-car partnership with French carmaker Renault.
Faced with tougher environmental regulation and consumer
demand for fuel-efficient cars that emit less carbon dioxide,
automakers are investing heavily in electric vehicles and
hybrids, which combine a conventional combustion engine with a
Electric sports car maker Fisker, its battery supplier A123
Systems and Better Place, a California-based recharging
infrastructure operator, have all gone bust in the past year.
Renault and Japanese partner Nissan have invested 4
billion euros in electric cars, but sales have lagged far behind
forecasts, with around 100,000 delivered to date.
Chief Executive Carlos Ghosn has acknowledged his carmarking
alliance's 1.5 million sales goal for 2016 will be missed.
However, other major manufacturers are moving into the
technology. BMW unveiled its carbon-fibre i3 mini earlier this
year along with plans to follow up with an i8 sports car.
Tesla Motors, the U.S. electric carmaker founded by
PayPal billionaire Elon Musk, is now worth $22.3 billion -
nearly half of General Motors or one-third of Ford's
Shares in Bollore group, which have risen about 47 percent
this year, were up 0.55 percent at 380.90 euros as of 1209 GMT
Its Blue Solutions business uses lithium-metal-polymer
technology rather than more common lithium-ion cells and also
makes power storage stations for solar and wind farms.
Bollore is behind the separate Paris electric car-sharing
programme, Autolib', which the company hopes to export to major
cities overseas, starting in Asia. Its recharging stations
dotting the French capital have won about 100,000 clients since
the service launched in late 2011.
"Energy is at the heart of the challenges to economic growth
worldwide," billionaire Bollore said in documents accompanying
the Blue Solutions offer. The listing on the Euronext exchange
will raise the company's profile and help its growth "in a
market that is particularly crucial for the immediate and medium
term", he said.
Last month Bollore group announced a deal with Renault to
bid for electric car-sharing contracts and assemble
battery-powered vehicles in France.
Bollore, 61, has declared ambitions to transform Blue
Solutions into a company with 1.5 billion euros in annual sales
and a 400 million euro operating profit in 2022, after breaking
even next year.
Financial details supplied with the offer prospectus suggest
an enterprise value of between 2.4 and 2.5 times forecast 2017
sales, according to Reuters calculations.
By comparison, Tesla is trading at a multiple of 7.6, while
most traditional mass carmakers and South Korean battery giant
LG Chem are closer to 1.
A lawyer by training, Vincent Bollore has become rich by
taking stakes in troubled companies, building a multi-billion
euro conglomerate out of the family's paper mills in Brittany,
Bollore is also the biggest shareholder in advertising
agency Havas and media group Vivendi, where
he was appointed vice-chairman last month following a boardroom
tussle as the group considers spinning off its SFR telecoms
The Blue Solutions offer period will run from Oct. 17 until
Oct. 28, with final pricing set on Oct. 29 and trading to begin
the next day.